Good morning, Mr. Chairman and members of the Committee.  I am Rex Johnson, President and CEO of the Hawai‘i Tourism Authority (HTA), the official tourism agency for the State of Hawai‘i.  IT has been my pleasure to serve Hawai‘i in this capacity for the past three years.

 

For your information, I am also a member of the U.S. Travel and Tourism Advisory Board (USTTAB), which serves in an advisory capacity to the Secretary of Commerce.  In addition, I serve as secretary of the Western States Tourism Policy Council (WSTPC), a consortium of 13 western state tourism offices, that work together to support public policies that enhance the positive impact of tourism on the American West.

 

On behalf of the State of Hawai‘i and the twelve other WSTPC member state tourism offices, I am pleased to be here today to provide testimony on opportunities to enhance and promote international travel to the United States.  To clarify, my testimony will be composed of three parts.

 

First, is the Hawai‘i Tourism Authority’s (HTA) efforts to promote travel to Hawai‘i.  To begin, I would like to state the importance of tourism to Hawai‘i.  Since 1976, tourism has been Hawai‘i’s number one industry.  As the chief generator of employment in Hawai‘i, tourism currently provides about one in every four jobs in the State in direct travel-industry jobs or in indirect employment.  Hawai‘i’s travel and tourism industry also produces $12.4 billion, or approximately 23 percent of the State’s Gross State Product, and contributes $1.3 billion tax dollars to the state and county government, or 23.2 percent of total state and county tax revenues.

From a marketing perspective, the HTA spends approximately $50 million annually in marketing programs designed to support a healthy tourism economy.  The programs support advertising, promotion, public relations, trade relations and other marketing efforts in our major market areas of North America, Japan, Other Asia (excluding Japan), Europe and Oceania.  Our efforts cover a variety of markets, including meetings, conventions and incentive travel in the business sector; weddings and honeymoons, leisure travel, cultural tourism, and other markets related to vacation travel.  While Hawai‘i tourism in total generates $12 billion in visitor spending annually, international visitors contribute about $4 billion of this amount and account for approximately 32 percent of visitor arrivals. 

 

Unfortunately, the condition of Hawai‘i’s international tourism markets has weakened over the years, due in many respects to the issues outlined in the USTTAB white paper which I will talk about shortly and in the blueprint that has been developed by the Discover America Partnership.  Travel to Hawai‘i from some international markets has fallen by 50 percent from their peak periods.  These markets are strategically important to Hawai‘i because they provide a stability and diversity to our visitor industry base and support other sectors of our economy such as retail and entertainment.

 

 

That brings me to my second point and that is, what the federal government can do to assist state tourism.  For one, maintaining and expanding the Visa Waiver Program (VWP) is central to keeping the U.S. competitive for inbound international travel.  Currently, more than two-thirds of all overseas travelers enter the U.S. under the VWP.  Easing international travel into the United States would provide a significant benefit for Hawai‘i tourism.  The expense and difficulty in obtaining visas has had a negative effect on markets such as Korea, and Taiwan, which have declined with the imposition of stricter travel policies.  In this regard, we particularly commend the Senate for recently approving the recommendations of the leaders of this committee and other Senators and adding provisions to the 9/11 Commission Act, which will strengthen and expand the visa waiver program.  We will be urging the House of Representatives to concur with these Senate provisions.

 

Additionally, the negative experience of international visitors going through our security systems is a deterrent for some to travel to the U.S.  According to a June 2006 survey of international travel agents, 77 percent believe the U.S. is more difficult to visit than other destinations.  A recent survey by the Discover America Partnership revealed that international travelers believe that the U.S. has the “world’s worst” entry process.  This perception creates a significant disadvantage for the U.S. in its efforts to compete for world travelers.  However, with more efficient access to our country and hospitality training for our security professionals, travel to the U.S. will definitely be easier to promote.  

 

 

Since 1992, America’s share of the world travel market has fallen 35 percent, despite a healthy boom elsewhere.  The price tag for this loss is staggering – about $300 billion in revenue over the last 15 years.  In particular, since 2001, the U.S. has experienced a 17 percent decline in overseas inbound travel.  In comparison, between 2004 and 2005, the U.S., witnessed a 10 percent decline in business travel while Europe experienced an 8 percent increase.  As pointed out in the Discover America Partnership Blueprint, travelers from America’s top source countries are either declining significantly or failing to keep pace with sizeable increases in travel to other destinations.  The gravity of the situation is more significant in light of a U.S. dollar that is 30 percent cheaper than it was five years ago.

 

Please note, reports that say international travel to the U.S. is increasing are misleading.  When you remove Canada and Mexico, and look solely at overseas travel, the number of visitors is declining – and it is doing so precipitously.  According to figures from the Department of Commerce, in 2006 inbound travel declined from each of America’s top 5 markets. 

 

There are many reasons for this decline, including the increased and enhanced travel restrictions related to understandable homeland security concerns, as well as greater competition from destinations abroad for the international traveler.  Another reason is the fact that the U.S. is one of the only industrialized nations in the world that lacks a nationally-coordinated program to compete for world travelers.  Today, nearly every industrialized country in the world, with the exception of the U.S., has a nationally-coordinated program designed to promote its destination to international travelers. 

 

For example, Australia spends $113 million dollars a year communicating and promoting itself to travelers, while Canada spends $58 million.  In comparison, the Travel Industry Association (TIA) estimates that all the combined states together spend about $25 million, but notes that many of the allocations are small.  It is imperative that the U.S. implement its own nationally-coordinated public-private marketing campaign in order to be competitive with other countries in the dynamic new world market.

 

A promotional program of this type could explain our travel policies to world travelers, highlight improvements in the process and invite millions more to enjoy the unique American experience every year.

 

And that brings me to my final point – the need for the U.S. to develop a national tourism strategy to compete for a greater share of the growing travel and tourism market.  That’s the intent behind the U.S. Travel and Tourism Advisory Board recommendations and the Discover America Partnership Blueprint. Together, these documents provide well-founded proposals to improve international travel to the United States that we fully endorse.  The HTA, along with other state tourism offices and organizations, are especially supportive of a promotional program to establish a national image for the United States as a visitor-friendly destination, while supporting improvements to security and entry formalities that ease the ability of visitors to enter our country. 

 

Without the benefit of a program establishing a national brand to promote visitation to the United States, some of our uncoordinated spending on international marketing is dedicated to diverse branding programs that, in other countries, would be initiated and focused by a national ministry of tourism.  If we had the support of a national promotional program as envisioned by the U.S. Travel and Tourism Advisory Board and the Discover America Partnership Blueprint, our efforts would be much more effective, since the national program would create a “visit USA” brand and a better selling environment. 

 

Importantly, the development of a national strategy as outlined above would be immensely productive for all states, including Hawaii.  As an example, the programs that would originate from this strategy could include creating a brand for America that is not just friendly and welcoming, but is also consistent with Hawai‘i’s "aloha spirit".

 

I would be remiss in not also emphasizing that another benefit of a nationally coordinated marketing program for international tourism would be to enhance the

image of the United States around the world.  Nothing will more contribute to a positive view of our nation among the world’s citizens than the personal experience of visiting here, meeting face to face with our wonderfully hospitable and welcoming citizens and experiencing American culture and values first-hand.  At a time when our nation’s international image has fallen to unprecedented levels, tourism could dramatically help reverse those attitudes.

 

 

 

In closing, I would like to thank you for the opportunity to speak with you today.  On behalf of the HTA and my colleagues in the travel and tourism industry, we look forward to working with you, the federal government and others in support of the 9/11 Commission Act and other legislation that will enhance the competitiveness of our nation in the global tourism market and help improve our international position.